So far there have been no obvious accidents when the drivers of thousands of cars streaming daily down Vivian St are momentarily distracted by the brilliant flashes of colour in the window of Roar! Many of the gallery's visitors are such passers-by. They catch a glimpse and return for a closer, safer look.

Behind the immaculate white gallery space, which, with its vivid offerings, fronts on to the busy road, is a warren of rooms breathtakingly crammed with artworks, desks, people and cheerful chatter. This is Pablos itself in vibrant action. Above one desk, a huge canvas Pablos Art Auction banner is a work in progress.

Organisers hope 300 people will turn up to the auction tonight. It is a fundraiser vital for Pablos' wellbeing or even existence – 20 per cent of the money needed to run it on a shoestring comes from this one event.

The list of empathetic non-Pablos artists who have given their work for free is a who's-who of collectable names.

"Some have donated for years," says Pablos Art Studios director Gaelen Macdonald. "Right throughout history there's been a connection with creativity and mental health. Lots of artists have encountered mental unwellness in their lives."

Among the donors are Dick Frizzell, Michel Tuffery, Nigel Brown, Wayne Youle, Matt Gauldie, Gavin Chilcott and Ewan McDougall. Bigger, sometimes more expensive, paintings will be sold in a live auction. A silent auction that will go on all evening will allow people to make a connection with work on the walls and decide, in a more leisurely way, if they want them.

Many of about 100 artworks come from Pablos' own artists, and some have made names for themselves. People these days, Macdonald says, are happy to let it be known they have been at Pablos, designed to provide a creative space for those who have experienced mental illness.

"Five years ago, people used to feel discriminated against if they worked at Pablos. Now most artists are really proud of this unique thing in their lives."

One of those proud artists is Fraser Hoffe, 41, whose scrunched, paint-poured, multimedia wall-sculptures come from long hours and a compulsion to create. They sell. It is, he says "strength of conviction" that makes his work desirable. "Artists make art for a drive rather than for an audience."

Not all that many years ago, Hoffe was homeless, for years employing his creative energy to survive, until the Downtown Community Ministry people helped find a flat for him. Then he discovered Vincents Art Workshop, another Wellington mecca for "outsider art". When that started closing on Thursdays, he began working at Pablos.

"I make bits and pieces here and take some to Vincents. I'm in between both places. I've always dabbled in different forms of art. Making things suits me." He recently had his fourth exhibition at Roar!

Hoffe has lived in several cities and had a plethora of previous jobs. Now: "Pablos allowed me to come in here and make things and I've built up an art practice. It's a place to come and create, like Vincent's, and it has a great gallery.

"Some people who come here have made art and some have never made art. You don't have to have artistic ability. It's an amazing space."

Whatever brush people have had with mental illness stays behind when they close the door to the street and are absorbed by Pablos' painting-plastered and festooned rooms. The place was set up after the disestablishment of mental hospitals in the early 1990s but it is not, Macdonald says, a mental-health organisation. Before it existed, artists were going into hospitals to help mental health patients and saw a need. With changing social policy funds became available and Pablos was one spinoff.

Government funds are not enough to keep Pablos afloat. The gallery doesn't pay for itself and the Roar! manager had to be dispensed with in favour of volunteers. Macdonald's is the only fulltime job. The Pablos philosophy, she says, is "about empowering artist and audience".

"It's art for a wider audience. You don't have to read a big blurb first to understand the artworks. You can make an immediate connection."

Macdonald's own training was conventionally formal. She graduated with a masters from Elam and in 2007, ready for a change from archival work she had been doing, applied for a job at Pablos. She has been director for three years. Staff are not mental-health workers. "It's an arts organisation. If people want to talk about their problems and distress in life, you have to go to a support person. We've had basic support training but we're not a mental-health organisation. It's OK to make mistakes here but the thing with Pablos is the emphasis on art. "

One of four tutors at Pablos is British-born Chris Barrand, who also teaches art at Rimutaka Prison. He has been in New Zealand for 12 years after working in the creative space sector in London, where he also studied design. "If you're going to be tutoring art, you need an art practice to be able to have all-important conversations with artists."

He earlier worked at the IHC Petone Art House and, at that time, made a connection with The Dowse's then-director Tim Walker, who was interested in outsider art – self-taught people who characterise those who use creative spaces. Barrand then moved on to Pablos. He spends three days each week there, a day at the prison, and a day pursuing his own art.

At one end of the spectrum in an organised creative space, he says, are people who may see art as a means of connection to a community and, at the other, capable artists who want a safe place to work – "and everything in between". "You need a level of awareness of where they're at. Pablos works in the mental-health sector but we're not mental-health workers. We're a creative space which happens to be for people with an experience of mental illness."

Bruce Hurley is one who no longer feels marginalised. Hurley, 52, signs his three-dimensional artworks Gypsy Blu and refers to them as "man kitsch". They often incorporate junk he comes across and $2 Shop finds – "and I'm a fantastic skip-diver". Hurley arrived at Pablos five years ago. He had been diagnosed with Parkinson's, diabetes and arthritis, followed by depression. "I was looking for something to do." He was living in the Hanson Court flats in Newtown and, fuelled with the pleasure he derived from Pablos, started up an art group there that eventually extended to other council housing in Wellington, with combined annual exhibitions. "Some people you know would sit home with their problems, drink et cetera. It gets them away from that, taking part."

Last year the idea won an Australasian award for tenant-run events. Hurley, once shy, has learned to speak in public. Pablos, he says, builds self-esteem and confidence. Last year he entered the Wallace Art Award with a picture based on Halley's comet, which his grandmother saw twice. "I had nothing to lose. I felt really good, even though I didn't get chosen".

Maggie used to be a potter and teacher "before a brain injury in hospital". "One day life and the next day nothing. This place allowed me to get to this stage ... one day it dawned on me I could come here. I had unfinished work but I couldn't pick up a brush or mix colours." She says she hadn't lost her skills – just "the bridge to access my artistic ability".

She says her mental and physical healing has taken five years so far. "It's a long journey and I couldn't have come here any earlier."

After five years of healing, she is now creating something new. "I'd never painted abstracts before."

A piece for the art auction is based on a fascination with centrifugal force. It is, she says, patronising to ask if she has found Pablos therapeutic. People go for all sorts of different reasons. "We're all vulnerable but we don't come here for therapy."

In the consciousness of all Pablos' artists is the auction and their contributions. Macdonald has been working on it for months, too. "Pablos gets to exhibit in an auction with established artists and it opens up a wider audience. It's a strong community integration project."

People who come to buy, she says, "see it as a fundraiser, with fantastic art and money going to a fantastic cause".

THE DETAILS

Pablos Art Auction 2012, Massey University Great Hall, tonight. Preview from 5pm. Auction begins 6.30pm. Tickets are $20 from Roar! gallery and $25 at the door.